List prices for various UFS grades in the U.S. were up $30 - $40/ton (announced = $60/ton) in May, according to Wilde. Fifty-lb offset rolls were up about $30/ton to $915 - $935/ton and 20-lb repro bonds were up ˜$40/ton to $1,090 - $1,135/ton. Producers expect to realize the balance increase in June and July as contract prices are revised and smaller suppliers implement the price increase.
This is the second price increase of the year following the $40/ton price increase in both cut-size and roll grades in March. The recent price increase is driven by capacity cuts (Domtar, IP), low inventory levels (-17% y/y), and sharply higher pulp prices. Trade reports suggest that May activity eased from levels seen in late Q1/early Q2. Imports into the U.S. are likely to begin creeping up over the next few months. Beyond the impact from a stronger U.S. dollar, production issues on Portucel's newest machine appear to have been resolved and export volumes to the U.S. are increasing toward a 200,000 tpy level, Wilde points out.
TAPPI
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